economy

A wedding gift needs to serve multiple purposes: You want it to say “congratulations” and avoid giving the impression that your wallet has been to one too many other celebrations this season.

There’s no easy answer to the question of how much is the right amount to spend on a wedding gift, but if you’re looking for guidance, these tips can help.

If you say no

If you’re invited to a wedding and RSVP no, you’re technically not on the hook to buy a present, according to lifestyle and etiquette expert Elaine Swann. Having something from the registry sent to the couple is a nice gesture, but not mandatory.

If you say yes

If you say yes, you’ll be expected to provide a gift. The difficult part is deciding how much to spend on it.

If you’re the kind of person who likes to compare, consider what other guests spend. The national average cash gift amount is $160, according to the 2016 Wedding Season Report by cash-giving platform Tendr, although regional averages vary. In Arkansas, the average gift is $73, while it’s $245 in Vermont.

Gift expectations also depend on your relationship: The closer you are to the bride and groom, the higher your financial obligation. “I think if you’re very good friends or family members, you’re going to probably want to give a little more than if you’re not as close to the couple,” says Diane Forden, the editor-in-chief at Bridal Guide magazine.

Another consideration? If you’re flying solo at the wedding, a smaller gift can suffice. Couples usually give more than individuals, according to Forden.

If you have other obligations

As a general rule, the more that’s required of you as a guest, the less that’s required when it comes to the gift.

“With a destination wedding, in my opinion, your presence is a present,” Swann says. “So for those who go out of their way to pay for airfare and hotel and all of the festivities around a destination wedding, then that’s your gift to the couple.”

You can also cut back on the gift if you’re in the bridal party. Between the showers, the bachelorette party and the bridesmaid dress, the whole process can be “financially crushing,” Forden says. If you’re feeling the pinch, she suggests chipping in on a group gift with your fellow bridesmaids.

Finances always trump etiquette. There’s nothing wrong with selecting an affordable present — even if it’s the least extravagant item on the registry, or it’s not on the registry at all.

“People should never be ashamed about being fiscally responsible,” Swann says. “So if you cannot afford to get an expensive gift, then don’t do it. Hold your head up high and say, ‘You know what, my budget allowed me to get this beautiful card, and that’s it.’”

Don’t overthink it. There’s no right or wrong amount to spend on a wedding gift, and weddings aren’t about the gifts, anyway.

“The focus shouldn’t really be on gifts,” Forden says. “It shouldn’t be a gift grab. It’s a celebration of a marriage, and I do think a lot of brides and grooms are aware of that.”

It’s easy to get caught up in credit card incentives, such as cash back, travel perks and sign-up bonuses. But if your credit cards don’t match your spending personality, you might not get the rewards you expect, or you might end up paying too much in fees.

One in five consumers carries a card that “has fees or rewards not aligned with their actual purchase habits,” according to J.D. Power’s 2016 U.S. Credit Card Satisfaction study.

And circumstances change. Even a credit card that was once compatible with your spending habits might no longer be the best fit. Identify your spending personality to determine whether the cards in your wallet are offering you the most value right now.

The jetsetter

If you travel in style often and want big rewards for your spending, a premium credit card will go further than a regular travel card. Some premium cards offer credits for airlines, hotels or airport security screening programs, as well as airport lounge access. They come with a large annual fee, but you likely spend enough to earn it back in the form of perks and a generous sign-up bonus.

The explorer

Travel is your hobby, but you’re not loyal to airline brands; you’re loyal to the best deals. General travel credit cards offer flexibility in reward redemption. Some charge annual fees, but you can often make up the cost in rewards, and the best cards don’t charge foreign transaction fees. However, travel rewards might lose value if you redeem them for anything other than travel.

The cash-back connoisseur

You like knowing the exact value of your rewards in cash, and you use plastic at every opportunity to earn more. Tiered and bonus-category cash-back credit cards offer higher rates on certain purchases and 1% on everything else. You could get more value by pairing one of these with a flat-rate cash-back card that pays 2% for all purchases. Minimalists should consider a single flat-rate cash-back card.

The balance carrier

Your paychecks aren’t always steady, so sometimes you lean on a credit card, and it’s not always possible for you to pay the balance in full every month. Still, you make sure you never miss a payment. Cash-back credit cards are tempting, but their high interest charges will outweigh your rewards. A low-interest credit card is more likely to save you money over time.

The self-starter

If you have bad credit or no credit, you probably have limited credit card options. Secured credit cards offer an opportunity for credit building. They require a security deposit that you get back after closing the account or upgrading to a regular, unsecured card. The credit limit is often relatively low, equal to the security deposit.

The survivor

You’re struggling to pay off debt, but if you have good or excellent credit, a balance transfer credit card can provide a way out. It allows you to transfer a balance from an existing credit card to take advantage of a lower interest rate. A card with a low balance transfer fee and a 0% annual percentage rate period can give you time to catch up on payments.

The optimizer

You’ll go to great lengths to get a good deal, including managing multiple credit card bills. Mixing and matching cards can be worth it as long as you save money. Just watch out for annual fees or interest.

If your credit card is no longer a match, it might be time to move on. But unless it charges an annual fee, don’t rush to close the account, because that could impact the length of your credit history — and your credit score.

Keep current cards active with the occasional, small purchase and use a new credit card to swipe your way toward your goals.

When it comes to saving for retirement, many teachers can’t use the standard lesson plan.

What’s different for them? Social Security coverage, or the lack thereof. About 40% of public school teachers aren’t covered by the Social Security system, according to the National Association of State Retirement Administrators.

That goes back to the initial draft of the Social Security Act in 1935, which left state employees out in the cold. Most states have since opted into Social Security for their public-sector employees, but 15 states haven’t. In those states, teachers and other state and local government workers are exempt from paying Social Security taxes and instead typically rely on a state-run pension plan.

+ Click to expand to see a list of the 15 states States where teachers are ineligible for Social Security AlaskaLouisiana CaliforniaMaine ColoradoMassachusetts ConnecticutMissouri Georgia (some areas)Nevada IllinoisOhio Kentucky (some areas)Rhode Island (some areas) Texas Why teachers aren’t covered by Social Security

The short answer: In part, it’s because they don’t pay into the Social Security system. But in some cases, even if they’ve paid in at some point in their career, Social Security benefits — including retirement, disability and survivors benefits — could be reduced if they also have a state pension.

The retirement and disability benefit reduction is due to a rule called the Windfall Elimination Provision, which is designed to block state and local public employees from collecting a pension alongside Social Security benefits. It does that by reducing Social Security retirement benefits. A separate rule, called the Government Pension Offset, can also cut into Social Security survivors benefits.

The Windfall Elimination Provision

You might wonder how Social Security can be reduced if you weren’t covered by the program in the first place. The answer is that it can’t. The Windfall Elimination Provision doesn’t directly affect you if you’ve never paid into the Social Security system; you simply won’t receive benefits.

But if you have contributed to the system — most likely because you paid Social Security taxes in a different job — and you now work for a state or local government in a role that doesn’t participate in Social Security, the Windfall Elimination Provision could reduce any Social Security retirement or disability benefit for which you’re eligible based on that past work.

Your Social Security statements likely won’t reflect that reduction, which is based on a special calculation. The maximum monthly reduction in 2017 is $442.50, limited to one-half of your monthly pension benefit. You will be subject to a smaller cut if you have 21 or more years of “substantial earnings” from a job in which you paid Social Security taxes. If you have 30 or more years of substantial earnings, your benefits won’t be reduced by the Windfall Elimination Provision.

How teachers can save for retirement

Teacher retirement options vary by state, but you’re generally offered either a pension or a defined contribution plan like a 403(b) or 457(b), or both.

Pensions have plenty of perks, most notably a guaranteed benefit in retirement that lasts as long as you live. But they’re also not without downsides. Many are underfunded or in debt, and they typically don’t travel well, requiring you to participate in the plan for a certain number of years before you’re vested (“vested” means promised the full pension benefit you’ve accumulated).

If you leave teaching or move to a different state before you meet the vesting requirement, you may forfeit any employer contributions. Contributions you’ve made — and often at least a portion of interest earned — are yours to keep. Generally, the longer you work, the larger your pension benefit.

All of this means it’s wise to supplement your pension. You can do that in a couple of ways:

1. A defined contribution plan

You may be eligible for a 403(b) or 457(b) plan alongside your pension. Both are similar to the private-sector 401(k) plan, in that they allow you to put aside money for retirement pretax. The annual contribution limit for 2017 is $18,000, with additional catch-up contributions in some cases. If you have both a 403(b) and a 457(b), those limits are separate. You may also earn employer matching contributions.

The money you contribute generally grows tax-deferred and will be taxed as income when you take distributions in retirement. Both plans may also offer a Roth individual retirement account option, which allows you to put away after-tax dollars and take retirement distributions tax-free.

One word of warning: 403(b) plans can be rife with fee pitfalls for participants, sometimes even more so than other employer-sponsored retirement plans. An analysis by human resources consultant Aon Hewitt found that those costs could add up to a cumulative leak of $10 billion annually. No matter where you invest, be sure to understand your fee costs by asking to see investment prospectuses or annuity contracts.

2. A Roth or traditional IRA

These are accounts you would open and fund on your own at an online broker. You can contribute up to $5,500 in 2017, with an extra $1,000 if you’re 50 or older.

With a traditional IRA, you make tax-deductible contributions, then pay taxes on distributions in retirement. With a Roth IRA, your contributions don’t get you an upfront tax break, but distributions in retirement are tax-free. Depending on your income, you may be able to combine IRA contributions with a 403(b) or 457(b), increasing how much you put away for retirement each year. Review the IRA contribution limits to find out, then learn how and where to open an IRA.

Mortgage rates for 30-year fixed-rate loans and 5/1 ARMs both fell by one basis point today, while 15-year fixed loans remained unchanged, according to a NerdWallet survey of daily mortgage rates published by national lenders Thursday morning.

Both fixed-rate products and 5/1 ARMs haven’t been this low in several weeks.

The Federal Reserve meets again next week, and going by the futures market, the general consensus is that the target range for the federal funds rate will be left as is, especially after Fed Chair Janet Yellen’s remarks last week that low inflation levels merited further observation.

NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

Finding a credit card that offered big rewards at restaurants used to feel like ordering vegetarian at a barbecue joint: There weren’t many options, and they often weren’t appetizing. But with consumers spending more on dining than ever before, that’s quickly changing.

In recent years, Chase, Citi, Capital One and PNC have all launched cards with an effective rewards rate of at least 3% on dining, a step above the 2% that was once the maximum dining reward on many cards. These are similar to the rewards on gas, groceries and travel that cardholders have enjoyed for years. And for many users, they’re just plain practical.

“Everyone has to eat. You end up with a lot of people who say, ‘Look, I may not go to New York every week, but I certainly go to restaurants every week,’” says Robert Hammer, CEO of R.K. Hammer, a bank card advisory firm.

Spending on dining out is rising

When deciding what credit card rewards to offer, issuers try to determine which perks will entice people to apply for a card — and then use it regularly. So they pay close attention to how potential customers are spending money.

“We’ve heard directly from [our customers] how important mealtime is,” Mark Mattern, vice president of U.S. cards at Capital One, said in an email. That’s how the issuer came up with the Capital One® Premier Dining Rewards Credit Card, introduced in March 2017, which offers unlimited 3% cash back on dining and 2% on groceries. “We know that these are categories that people are spending more in and are passionate about,” he added.

Consumer spending trends reflect that. In 2015, sales at restaurants and bars overtook spending at grocery stores for the first time ever, according to a Bloomberg report citing Commerce Department data. Consumer spending on food services has also been steadily increasing, reaching an all-time high in 2016, according to the most recent data available from the federal Bureau of Economic Analysis. To credit card issuers, these trends present a business opportunity.

Issuers don’t offer bonus rewards on dining simply because they want a piece of dining purchases; they also want to appeal to a specific type of consumer. The two groups currently most sought-after by financial institutions — high-income consumers and young adults — happen to be prolific diners.

Among households with incomes in the top 20% nationwide, 49% of food spending went to food away from home, which includes spending at restaurants and fast food joints and on takeout, according to 2015 data from the Bureau of Labor Statistics. That amounts to $6,040 per year, more than 4.5 times what those with incomes in the bottom 20% spent in that category.

Millennials tend to dine out more frequently than other age groups. A December 2016 Gallup poll found that 72% of 18- to 34-year-olds had eaten dinner at a restaurant once in the previous week, the highest rate of any age group surveyed.

These two groups mean big business to credit card companies. High-income shoppers, of course, have more money to spend. That can generate revenue for issuers in the form of transaction fees and interest charges.

Millennials, meanwhile, bring growth potential, a point underscored in Chase’s most recent annual report. “[Millennials’] wealth is expected to grow at the fastest rate of all generations over the next 15 years,” writes Gordon Smith, CEO of consumer and community banking at Chase. The majority of new cardholders with the Chase Sapphire Reserve℠, which features rich dining rewards among several other benefits, were millennials, according to the report.

Would you like rewards with that?

Credit cards with supersized dining rewards benefit issuers, certainly. But if you use yours responsibly and pay the balance in full every month, they can especially benefit you. If you’re deciding which credit card to use for restaurant excursions, and all of your options offer 3% back on dining, look for these features:

No annual fee: It generally doesn’t make sense to pay an annual fee just for dining rewards. Many cards these days offer 3% back on dining — and other perks — and don’t charge an annual fee.

Unlimited earnings: If you spend big bucks on dining, choose a card without a spending cap. The Capital One® Premier Dining Rewards Credit Card, launched in 2017, and the AARP® Credit Card from Chase, relaunched with dining rewards in 2013, are both good options.

Other rewards and benefits: Dining rewards might be your main objective, but many of these cards offer other perks. Choose one with the benefits that best fit your spending habits. If you’re a commuter, find a card that supplements your dining cash back with gas rewards. If you also frequent the supermarket, get your dining rewards with a side of grocery bonuses.

Getting more cash back, points or miles on dining purchases is great, but it doesn’t have to be the only useful benefit your card offers.

It’s easy to get caught up in credit card incentives, such as cash back, travel perks and sign-up bonuses. But if your credit cards don’t match your spending personality, you might not get the rewards you expect, or you might end up paying too much in fees.

One in five consumers carries a card that “has fees or rewards not aligned with their actual purchase habits,” according to J.D. Power’s 2016 U.S. Credit Card Satisfaction study.

And circumstances change. Even a credit card that was once compatible with your spending habits might no longer be the best fit. Identify your spending personality to determine whether the cards in your wallet are offering you the most value right now.

The jetsetter

If you travel in style often and want big rewards for your spending, a premium credit card will go further than a regular travel card. Some premium cards offer credits for airlines, hotels or airport security screening programs, as well as airport lounge access. They come with a large annual fee, but you likely spend enough to earn it back in the form of perks and a generous sign-up bonus.

The explorer

Travel is your hobby, but you’re not loyal to airline brands; you’re loyal to the best deals. General travel credit cards offer flexibility in reward redemption. Some charge annual fees, but you can often make up the cost in rewards, and the best cards don’t charge foreign transaction fees. However, travel rewards might lose value if you redeem them for anything other than travel.

The cash-back connoisseur

You like knowing the exact value of your rewards in cash, and you use plastic at every opportunity to earn more. Tiered and bonus-category cash-back credit cards offer higher rates on certain purchases and 1% on everything else. You could get more value by pairing one of these with a flat-rate cash-back card that pays 2% for all purchases. Minimalists should consider a single flat-rate cash-back card.

The balance carrier

Your paychecks aren’t always steady, so sometimes you lean on a credit card, and it’s not always possible for you to pay the balance in full every month. Still, you make sure you never miss a payment. Cash-back credit cards are tempting, but their high interest charges will outweigh your rewards. A low-interest credit card is more likely to save you money over time.

The self-starter

If you have bad credit or no credit, you probably have limited credit card options. Secured credit cards offer an opportunity for credit building. They require a security deposit that you get back after closing the account or upgrading to a regular, unsecured card. The credit limit is often relatively low, equal to the security deposit.

The survivor

You’re struggling to pay off debt, but if you have good or excellent credit, a balance transfer credit card can provide a way out. It allows you to transfer a balance from an existing credit card to take advantage of a lower interest rate. A card with a low balance transfer fee and a 0% annual percentage rate period can give you time to catch up on payments.

The optimizer

You’ll go to great lengths to get a good deal, including managing multiple credit card bills. Mixing and matching cards can be worth it as long as you save money. Just watch out for annual fees or interest.

If your credit card is no longer a match, it might be time to move on. But unless it charges an annual fee, don’t rush to close the account, because that could impact the length of your credit history — and your credit score.

Keep current cards active with the occasional, small purchase and use a new credit card to swipe your way toward your goals.

For years, Jacques Hopkins wanted to make money online with a flexible side gig. Now the former electrical engineer has found a niche that has become his career: teaching people to play modern songs on the piano in 21 days, all over the internet.

Hopkins didn’t make the transition overnight. He and his wife had been saving for years before he started his own business. Here’s how they did it — and how you can turn a hobby into your main hustle.

From engineer to entrepreneur

Piano teaching wasn’t Hopkins’s first entrepreneurial idea. He tried a few that didn’t take off, including an invention that turned regular desks into standing desks. He learned from that experience that he didn’t want to sell physical products.

But he could sell lessons online, from anywhere. So he developed a more accessible and efficient method of teaching piano than the formal lessons he took from ages 5 to 17.

And so began his side business, Piano In 21 Days. The company’s tagline says it all: “I help regular people learn to play modern songs on the piano in as little time as possible.” What started as YouTube videos of Hopkins playing pop songs became a 21-day online course.

Hopkins knew the project would be more successful if he could devote more time to it — so he quit his day job. “The website took off once I was focusing on it eight hours a day,” he says.

Saving for the jump

Before Hopkins quit his engineering job, he and his wife, Niki, prepared to lose that income. The first step: paying off their mortgage. Then, Hopkins says, “the money we were putting toward the mortgage started going to a savings account.” Niki also received a pension from a previous job, which helped them build savings.

The family amassed enough to live on for a year, frugally, without much support from the piano business. “We wanted to make sure we had enough savings so that if this failed miserably, we would still be able to have money to live on and time for me to find another job if I needed to,” Hopkins says.

Building a ‘security blanket’

In the event that Piano in 21 Days did fail miserably, and Hopkins couldn’t find work, the family had a backup: a $20,000 emergency fund. “That was sort of a security blanket that was just sitting there,” he says.

Hopkins had started the fund years before. He had very little debt and was able to contribute about $500 per month. After two years, he saved about $12,000. Once he and Niki got married, they gradually increased the fund to about $20,000.

“You just attack it,” he says of building the fund. “Five, six, seven hundred dollars a month — whatever you have.”

The benefits of working online

Hopkins, his wife, who is expecting, and their toddler daughter are based in Baton Rouge, Louisiana, but Hopkins can live and work from anywhere. Most of his work involves talking with prospective customers on the phone, as well as marketing and growing the business. He occasionally posts a new YouTube video, tweaks the website and posts on social media. He outsources other tasks.

Hopkins and his family take advantage of his flexibility by traveling often. For example, last summer they spent three months in France. “We’re having a blast,” he says. But even when Hopkins is on vacation, he talks with prospective customers. “I’m not going to stop taking those phone calls,” he says.

Lucrative earnings and European vacations are far from the only benefits of Hopkins’s work. He loves that he’s helping people all over the world. “When I worked a real job I was hardly able to see my impact, but now I get feedback daily from people thanking me for helping them learn to play piano,” he says. “That’s really what keeps me going.”

Inspiration for others

Want to make money online like Hopkins? Start by exploring his favorite resources. He says he was most influenced by Tim Ferriss’s “The 4-Hour Work Week,” which inspired him to pursue a side gig when he was still in college. He also recommends Jeff Walker’s “Launch,” which is specific to building an online business.

“I wish I would have known sooner that running your business purely on the internet was possible,” Hopkins says.

Graduation season is in full swing and for many Americans that means one thing: It’s time to head to the ATM.

Cash is expected to be the go-to gift again this year for new grads, followed by greeting cards and gift cards, according to survey results released this month by the National Retail Federation. The appeal is obvious: The recipient can spend the money how she pleases, there’s no hassle with receipts or returns and minimal effort is required of the giver.

If you like the idea of giving cash but want something with more oomph, consider stock. It potentially has a longer shelf life and higher returns. A gift of stock also helps a recipient learn how to invest.

There are some considerations unique to gifting stock, however, including understanding the intended recipient’s immediate financial needs. Here are four questions to consider before you give stock.

1. Are stocks the right gift?

It’s generous to help someone invest for the future, but be cognizant of the recipient’s pressing needs. Does the new grad have high-interest credit card debt? Is he facing uncertain job prospects? Does she have forthcoming expenses (moving to a new city, for example) that could push her into debt?

If “yes” is the answer to any of the scenarios above, the gift of investments may not be practical. Even worse, a cash-strapped new grad could be tempted to sell the stocks and forgo the long-term benefits while also triggering taxes.

If the gift is for a minor, there are ways to limit when or how she’ll access that investment. By setting up a custodial account, you’ll manage the account on her behalf until she’s of age (generally 18 or 21 years old, though some states allow you to specify an older age). At that point, she’ll be free to do with it as she pleases.

There are two basic ways to give stocks: transferring shares you already own or buying new ones. Deciding which is best will depend on your current holdings and the tax implications for the recipient.

Since the gift is being made with the recipient’s best interest in mind, you should know that transferring shares to them means you’re also transferring any capital gains tax burden for those shares. When it comes time to sell, they’ll face realized capital gains based on the stock’s value when you first bought it.

For example, if you’re gifting 100 shares of a company that you bought at $25 a share and the recipient sells when the stock’s trading at $40 a share, they’ll pay taxes on a capital gain of $1,500. If instead you were to buy and gift new shares of that same stock when it was trading at $35 per share and they sold it at $40, they would only pay capital gains on $500.

If you still want to transfer shares of an existing holding, the process varies depending on how you hold the stock — in a paper certificate, with a brokerage or through direct registration with the company. Contact the institution that oversees your holdings to find out what steps and paperwork are needed to complete the transfer.

In general, you’ll need the following: a description of the securities you’re gifting (company name, ticker symbol and number of shares), your account number and your contact information, as well as the recipient’s full name, Social Security number, contact information and the account where the investment should be transferred.

If the recipient is a newbie to the world of investing and doesn’t have a brokerage account, you may be able to transfer stocks through the Direct Registration System. This will put the recipient on the books as an investor with the company.

If you’re looking to give a stock you don’t currently own (or you don’t want to part with your own shares), you have choices. Much like a transfer, you’ll need to direct this purchase to an account in the recipient’s name by buying shares directly through the issuing company or a brokerage.

Several websites cater to people who want to give stock, including GiveAshare.com, SparkGift.com and Stockpile.com, but there can be a premium for novelty. Buying one share of a company and having the certificate framed could cost as much as twice the stock’s current trading price on GiveAshare, for example. For any of these sites, be sure to check fees, which may be higher than a traditional brokerage.

Whether you’re transferring shares or buying new ones to kickstart a new grad’s investment portfolio, there are likely limits to your generosity. The IRS agrees.

You can give annual gifts up to $14,000 (which includes the value of stocks) to any number of recipients and you’ll be exempt from paying federal gift taxes. Go above that amount and you’ll owe.

Your altruism has other tax implications, as well. You get a tax benefit when transferring stock by avoiding capital gains taxes on that investment, but as noted above, the recipient assumes that burden. For new investments, there’s no capital-gains tax benefit for the giver and the cost basis for the recipient is the value of the investment at the time of purchase.

4. What lessons do you want to impart?

Cash may be king at graduation, but it’s also here today, gone tomorrow. Stock gifts can be memorable and meaningful beyond the potential for financial gains, as Alex Whitehouse’s story shows. As a toddler, he received 10 shares in a utility company from his grandfather.

“At first I was just excited to receive something in the mail with my name on it, but later on it sparked an interest in the stock market and an appreciation for the impact of reinvested dividends,” says Whitehouse, who is now president of Whitehouse Wealth Management in Vancouver, Washington. “That gift had a huge impact on me. It led me on the path to becoming a financial advisor.”

Now, Whitehouse helps his clients pay this forward, recommending grandparents gift stock to their grandchildren, particularly shares of companies that will resonate with the younger generation.

Stock gifts require more planning than stuffing money into a greeting card. But by making that effort, perhaps you’ll spark an early interest in investing or help the recipient plan for the future — and it’s impossible to predict where that may lead.

First, find the bright side. Even if you didn’t save as much money as you had hoped, imagine if you hadn’t set that goal at all. You’d still be back where you started — with the same amount in the bank. So kudos on making progress and getting serious about your finances.

Then, look at the setback as a learning opportunity. Rather than simply extending a goal’s deadline when the original timeline doesn’t pan out — or worse, taking on debt to finance the rest — diagnose where your savings plan went awry.

“Once you’ve reached that goal, or more importantly not reached that goal, I really think it’s important to look back at the spending habits and trends over the time and compare it to the budget you set up,” says Robert P. Finley, a chartered financial analyst, certified financial planner and the principal of Virtue Asset Management in Illinois.

You can do this by asking yourself a series of questions, Finley says, including:

The answers will help you determine if your goal was feasible. You can’t avoid paying a fixed amount for some things, like your mortgage or rent, but other spending categories, like eating out, have more wiggle room.

Based on your self-audit, make some adjustments to your savings strategy. If you’ve already cut your budget as much as possible, it might be time to find a way to make more money — at least until you reach your goal.

If you have your heart set on a vacation, for instance, you may be willing to take on a weekend job, babysit or work a side hustle to make ends meet, says Stephanie Genkin, CFP, the founder of My Financial Planner LLC in New York.

Or, you could make compromises to reach your goal sooner rather than later. “We’re looking at something that’s similar, yet maybe a little more affordable,” says Tony Madsen, CFP, the founder of NewLeaf Financial Guidance LLC in Minnesota. “Instead of going to Maui, is there a different trip that you can do altogether that becomes affordable for you?”

Whatever route you choose, avoid taking on debt to achieve a goal that’s not an absolute necessity. “The worst scenario is to charge it and then add 15% debt interest to your overall net worth,” says Finley.

Be your own cheerleader

As you pursue your goal for a second time, monitor your progress regularly. Madsen recommends setting check-ins at a cadence that’s comfortable for you. The goal is to analyze and adjust as you go.

Be sure to celebrate each milestone you hit along the way, too. Like most things in life, financial goals don’t have to be executed to perfection.

“If you ride a horse, you are sometimes going to fall off,” says Norman M. Boone, CFP, the founder and president of Mosaic Financial Partners Inc. in California, in an email. “The key to success is getting back on, resetting your goal and continuing to move forward.”